1. Field
The present disclosure relates to techniques for aggregating one or more participants in a power system in order to provide an energy service. More specifically, the present disclosure relates to exchanging price points and approximations to supply functions that facilitate aggregation of the one or more participants in order to provide the energy service.
2. Related Art
In traditional electricity markets, economic mechanisms are frequently used to arrive at accurate incentives and to dispatch services. For example, an operator of a power system, such as an independent system operator (ISO), may request bids up to 24 hours in advance of a desired service. In response to the request, one or more suppliers, such as a power plant, may bid to supply power or ancillary services (such as regulation, load following, spinning reserve, non-spinning reserve, replacement reserve and/or other services that help maintain power system stability in response to unanticipated variations in the supply and demand of electricity). Based on the received bids, the ISO may select or dispatch the services it needs to operate the power system or grid. In the case of contingency services (e.g., spinning reserve), the ISO may dispatch the services and compensate the corresponding suppliers for being available, even if these suppliers are not subsequently required to provide power.
With the deregulation of electricity markets, and the increased integration of communication and control technology in power systems, it is increasingly attractive for flexible electricity consumers (such as individual residences, as well as small and medium-sized businesses, which are henceforth collectively referred to as ‘participants’) to supply energy services to an ISO. For example, residential consumers of electricity can, in principle, provide ancillary services by shifting their consumption of electricity relative to their baseline consumption patterns. Because of the small size of the these residences and small businesses, typically aggregators in the power system likely want to combine and coordinate the supply and/or demand of multiple participants in order to aggregate sufficient energy service to meet the needs of the ISO.
However, the participants may not be able to offer the same quality of service that an aggregator needs to provide to the ISO. Furthermore, the participants may not wish to be exposed the full risks of trading a volatile energy spot market. As a consequence, it may not be practical for the participants to interact with an aggregator using the same mechanism that the aggregator uses to interact with the ISO. For example, it may not be reasonable to expect that a participant bid up to 24 hours in advance of a desired service, such as a power reduction or being on standby for power reduction (which is the demand side equivalent to spinning reserve). Typically, residential customers or small businesses are not able to predict their load 24 hours in advance. Consequently, they may not be willing to commit to a future reduction with high reliability.
In addition to the increased risk associated with the different time scales between when an ISO requests bids and when participants may be willing to offer changes in supply or demand, it may be difficult to optimize the decisions of the aggregator and the distributed participants. For example, participants may need to balance the impact of reduced demand with the commensurate economic reward. Similarly, the aggregator may need to balance the price offered by the ISO for a desired service versus the fees paid to the participants. However, it can be difficult for the aggregator and the participants to perform these optimizations without information about the consequences of their decisions for counterparties.
An economic mechanism, such as a market or an exchange, can simplify the interaction between the aggregator and the participants. For example, using a price setting or auction mechanism, a locally stable price and supply can be identified. However, economic mechanisms often have poor convergence properties. For example, even though a distributed economic mechanism may (ultimately) arrive at a good or optimal equilibrium solution, this process can be time consuming and may involve oscillations that can degrade the operation and performance of the power system.
Hence, what is needed is a method and a system that facilitates aggregation of the energy service without the problems listed above.